I've just returned from a business trip to Norway. One of the first things I noticed upon my arrival there, on the way into town from the airport, was the price of gasoline. Since Norway still uses its own currency rather than the Euro--lucky them--I had to look up the exchange rate before I could calculate that 15.40 Norwegian Kroner per liter equated to a penny or two under $10 per gallon. I'll bet that Norwegians would be ecstatic if it were only $4 a gallon. Gasoline isn't the only thing that's expensive in Norway--a draft beer was $9--but the remarkable thing about its price there is that, unlike nearly all European countries, Norway is a net exporter of both oil and refined products, including to the US. Most major producing countries subsidize motor fuel for their populations; Norway taxes it exorbitantly and effectively puts the proceeds into its Government Pension Fund.
As a result, there's at least one developed country that is well-positioned to manage its public pension liabilities. Although I wouldn't advocate adopting exactly the same system here, since among other differences we're still a significant net importer of crude oil--despite the weak economy having made us a net exporter of products--it does suggest some possibilities. Could Congress compromise on opening up more US oil and gas resources for development if the royalties were slated for infrastructure investment or a new Social Security trust fund that amounted to more than just an accounting exercise involving government paper? It's an interesting model to contemplate.
